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What Explains the Increased Utilization of Powder River Basin Coal in Electric Power Generation?

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  • Shelby Gerking
  • Stephen F. Hamilton

Abstract

This article examines possible explanations for increased utilization of Powder River Basin (PRB) coal in electric power generation that occurred over the last two decades. Did more stringent environmental policy motivate electric power plants to switch to less polluting fuels? Or, did greater use of PRB coal occur because relative price changes altered input markets in favor of this fuel. A key finding is that factors other than environmental policy such as the decline in railroad freight rates together with elastic demand by power plants were major contributors to the increased utilization of this fuel. Copyright 2008, Oxford University Press.

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  • Shelby Gerking & Stephen F. Hamilton, 2008. "What Explains the Increased Utilization of Powder River Basin Coal in Electric Power Generation?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 90(4), pages 933-950.
    • Handle: RePEc:oup:ajagec:v:90:y:2008:i:4:p:933-950
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    File URL: http://hdl.handle.net/10.1111/j.1467-8276.2008.01147.x
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    Cited by:

    1. Di Maria, Corrado & Lange, Ian & van der Werf, Edwin, 2014. "Should we be worried about the green paradox? Announcement effects of the Acid Rain Program," European Economic Review, Elsevier, vol. 69(C), pages 143-162.
    2. Roemer, Kelli F. & Haggerty, Julia H., 2021. "Coal communities and the U.S. energy transition: A policy corridors assessment," Energy Policy, Elsevier, vol. 151(C).
    3. Stratford Douglas & Seth Wiggins, 2015. "Effects of Acid Rain Regulations on Production of Eastern Coals of Varying Sulfur Content," Working Papers 15-38, Department of Economics, West Virginia University.
    4. Richard Schmalensee & Robert N. Stavins, 2013. "The SO 2 Allowance Trading System: The Ironic History of a Grand Policy Experiment," Journal of Economic Perspectives, American Economic Association, vol. 27(1), pages 103-122, Winter.
    5. He, Qingxin & Lee, Jonathan M., 2016. "The effect of coal combustion byproducts on price discrimination by upstream industries," International Journal of Industrial Organization, Elsevier, vol. 44(C), pages 11-24.
    6. James MacDonald, 2013. "Railroads and Price Discrimination: The Roles of Competition, Information, and Regulation," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 43(1), pages 85-101, August.
    7. Elbakidze, Levan & Zaynutdinova, Gulnara, 2016. "Substitution in electricity generation: A state level analysis of structural change from hydraulic fracturing technology," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235780, Agricultural and Applied Economics Association.
    8. Gerking, Shelby & Hamilton, Stephen F., 2010. "SO2 policy and input substitution under spatial monopoly," Resource and Energy Economics, Elsevier, vol. 32(3), pages 327-340, August.
    9. Chen, Jiandong & Huang, Shasha & Shen, Zhiyang & Song, Malin & Zhu, Zunhong, 2022. "Impact of sulfur dioxide emissions trading pilot scheme on pollution emissions intensity: A study based on the synthetic control method," Energy Policy, Elsevier, vol. 161(C).

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